New research shows that while involuntary job loss can be harmful to health for all workers, people who suffer a health-related involuntary job loss experience more significant depression and detrimental health outcomes than people who lose their jobs for nonhealth reasons.

The U-M study also suggests that people who are re-employed quickly have better health outcomes than those who remain unemployed.

It's not clear how many people involuntarily lose their jobs for health-related reasons, but shaping policy to meet the needs of this population is critical. "We need to know more about this population for intervention and policy reasons," says Sarah Burgard, assistant professor of sociology with appointments in the Institute for Social Research (ISR) and the School of Public Health. "Re-employment appears to be key for mitigating these health effects for people who lose their jobs — either for health-related reasons or other reasons, (such as) a layoff."

People who have lost their jobs and want to get back to work may need the assistance of interim health insurance coverage, unemployment benefits and re-employment programs. This may be particularly true for people who have health problems that caused them to lose their jobs. These traditional employment benefits, however, were designed to meet the needs of workers in standard full-time jobs.

Increasingly, part-time, temporary or short-term service industry jobs are replacing the standard, full-time jobs disappearing from manufacturing and other industries, and the new jobs often lack health insurance coverage or unemployment insurance eligibility. This means that people working part-time or with other nonstandard employment contracts will face the greatest challenges getting back into the labor force if they experience a job loss because they don't benefit from these programs.

These findings underscore the social and economic importance of structuring health insurance, unemployment benefits and re-employment programs to meet the needs of an evolving workforce, as nonstandard employment contracts become more common. For example, since health insurance is often tied to full-time, long-term employment, the most vulnerable workers in the new service economy have no access to employer-sponsored health care while they are employed. After a job loss for health reasons, such workers would have few resources to aid recover and help with a new job search.

Burgard and her co-authors, James House, professor at ISR, the Gerald R. Ford School of Public Policy and Department of Sociology, and Jennie Brand, assistant professor of sociology at the University of California, Los Angeles, improved on existing research by distinguishing between health-related job losses and other involuntary job losses, such as layoffs, to reassess the effect of involuntary job loss on health.

The paper, "Toward a Better Estimation of the Effect of Job Loss on Health," appears in the December edition of the Journal of Health and Social Behavior.